Currently I have my 401k with Fidelity and 100% in SpartanŽ 500 Index Fund - Fidelity Advantage Institutional Class.

I am switching companies, and the new company is offering Principal.

Questions:

1) Should I move to a comparable fund to Principal or leave it at Fidelity?
2) What fund at Principal should I choose OR are they not good?
3) your recommendation and WHY

I understand another option would be to roll it into an IRA and potentially not use Principal at all.

There is no match at new company and I am 26 years old.

Thanks!

Sat Sep 21, 2013 2:47 am

coasterSenior Advisor

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Principal Financial Group began life as an insurance company and that's been its primary focus for most of its history. Fidelity Investments is and always has been a premier low-load/no-load mutual fund investment company, and that's been its primary focus for all of its history. Now, which one would YOU prefer to sell you your investments and manage them for you?

Since there is no match at the new company, I don't really see much advantage over a self-directed IRA.

~Tim~

Sat Sep 21, 2013 5:20 am

SdubzFull Member

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Thanks for your insight Coaster.

I have an account with vanguard.

what is a comparable fund to the fidelity fund i have that vanguard offers?

Sun Sep 22, 2013 7:10 pm

SdubzFull Member

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also, if i can only put 6500 in a traditional IRA, should i just go with the 401k to max out 16500?

Sun Sep 22, 2013 7:16 pm

clydewolfSenior Member

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quote:Originally posted by SdubzThanks for your insight Coaster.

I have an account with vanguard.

what is a comparable fund to the fidelity fund i have that vanguard offers?

quote:Originally posted by Sdubzalso, if i can only put 6500 in a traditional IRA, should i just go with the 401k to max out 16500?

At age 26, the most you can contribute to an IRA for 2013 is $5,500.

The $6,500 contribution limit is for those over age 49.

If you are in the 25% or higher tax bracket, then it is definitely smart to contribute to your 401k plan. Your contributions to your 401k are tax deferred until distributed from your 401k. And if you are transferring your 401k to a Traditional IRA, that tax deferment continues until distributed from your IRA.

Sun Sep 22, 2013 7:38 pm

WinoSenior Member

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At 26, most of the money you end up with in your retirement account will be gains, and not deposits. Due to this, you should first max out your Roth, and after that, invest in your traditional IRA or 401K.

Mon Sep 23, 2013 1:45 am

SdubzFull Member

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Thanks for all of your insight coaster, wino, and clydewolf!

I have a 401k with Fidelity and in my vanguard acct i have a VTSMX index fund.

I am thinking of rolling over my fidelity 401k into the VFINX fund.

Then opening a Roth IRA with vanguard with the VFINX? and max that out.

after that, should i MAX out my new jobs 401k or traditional IRA with vanguard(which fund would you choose?)